For each of the following, draw a supply and demand diagram for the overnight interest rate. Also, provide a brief written explanation of your answer and what will happen to the overnight interest rate, non-borrowed reserves, and total reserves.

aCurrently the equilibrium overnight rate is 8% and there is $0 in borrowed reserves, $20 in total reserves. The rate the Central Bank charges for overnight loans is 10% and pays 8% for reserves. Show what will happen if the economy booms.

b) Currently the equilibrium overnight rate is 6% and there is $0 in borrowed reserves, $20 in total reserves. The rate the Central Bank charges for overnight loans is 6% and it pays 6% on reserves. Show what will happen if the Fed sells $2 in bonds to banks.

c) Currently the equilibrium overnight rate is 8% and there is $10 in borrowed reserves, and $20 in total reserves. The rate the Central Bank charges for overnight loans is 8%. The Central Bank also pays 6% on any deposits banks keep at the Central Bank. Show what happens if they lower the rate the Central Bank charges for overnight loans to 7%.